Cellular South Expands CDMA 1XRTT Network; Data Rollout Planned for Quarter Three.

Business Editors/High-Tech Writers

JACKSON, Miss.--(BUSINESS WIRE)--June 1, 2004

With the Quarter One 2004 completion of a $38 million expansion of its CDMA 1XRTT network, Jackson, Mississippi-based Cellular South has added more than 100 cell sites to enhance and extend its network since September 2003. In the last five years, Cellular South has invested more than $260 million in network improvements.

Due to the CDMA 1X overlay of its network in Alabama and Florida, plus the additional cell sites, the company's CDMA 1X network has increased by twenty percent and provides seamless coverage from Memphis, Tennessee, through Mississippi, Coastal Alabama and the Florida Panhandle to Walton County. With its network now 100 percent CDMA 1X, capacity for voice and data traffic is in place to support the company's groundbreaking flat-rate Unlimited Calling Plan, unlimited text messaging service and plans for rollout of enhanced wireless data services.

"Building and maintaining a wireless network can almost be compared to a chess game. We've added towers and cell sites in strategic locations throughout our region - focusing on improving existing service and providing service where the national carriers won't," said Hu Meena, Cellular South president. "Most national wireless companies won't extend their networks into some of the rural areas we serve, but the new towers fit nicely into our long-term plans for growth."

In addition to increasing coverage where there were gaps or limited service, network improvements and expansion has primarily focused on making the switch from TDMA to CDMA 1XRTT. Now that the conversion is complete, the company has launched a new marketing campaign to encourage its customers to upgrade to the newer technology. Efforts appear to be working. In the third quarter of 2003, 46 percent of Cellular South customers utilized TDMA technology and as of the first quarter of 2004, that number has declined to 27 percent, reflecting the swift move to the CDMA network.

"Providing the best service possible, and focusing on what customers want most, better call clarity and fewer dropped calls, has helped us achieve a better than industry average churn rate," said Meena. "Our churn rate has decreased from 2.1 percent in the fourth quarter of 2003 to 1.7 percent in the first quarter of this year."

Cellular South plans to launch its data application services on its CDMA 1X network in Quarter Three 2004. The company will offer an array of BREW (Binary Runtime Environment for Wireless) services and picture messaging.

"Now that we have elevated our system to a level where we have significantly improved call clarity and reduced our dropped call rate, we're introducing enhanced 1X games, photos and Internet email," said Meena. "We've chosen BREW applications because they allow us to create a better user experience by controlling capacity. Therefore, we won't cannibalize our spectrum for data services. We're adding data and keeping network quality, which is most important to our customers."

About Cellular South

The company is one of the largest privately held wireless providers in the U.S. and is licensed to provide wireless service - to a total population of more than five million people - on its network stretching from the Memphis Metropolitan Area, throughout all of Mississippi, along Coastal Alabama and the Florida Panhandle through Destin/Seaside. Cellular South offers a different kind of wireless service based on the simple premise that customers have rights, including the right to the best network available, and service and pricing that is fair and makes sense. For more information, contact Cellular South at 1-877-CSOUTH1 or visit cellularsouth.com.